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Article
Publication date: 19 August 2024

Varadharajan Sridhar, Bhuwnesh Lohani, Balaji Parthasarathy and Preeti Mudliar

Digital platforms that offer on-demand gig work, while providing work opportunities in the economy, have raised social and economic concerns. Though extensive research on…

Abstract

Purpose

Digital platforms that offer on-demand gig work, while providing work opportunities in the economy, have raised social and economic concerns. Though extensive research on regulation of the gig economy exists, the effect of economic regulations on the welfare of the workers is not well understood. In this work, this paper aims to specifically study the effect of minimum wage and leisure regulations on the unemployment rate and offered wages. This paper also analyses the effect of up-skilling of the workers on unemployment and wages.

Design/methodology/approach

This paper builds an agent-based model of the labour market with heterogeneous workers and online platform firms that interact to match supply and demand. This paper also interviewed online workers in the two under-studied markets in online beauty and house maintenance services in India and included salient observations in to the model. This paper further validates the model findings with the interview observations.

Findings

Extensive simulations of the model indicate that the regulator's intervention on minimum wage and leisure reduces unemployment and offers better wages/leisure in the short term. However, these cannot be sustained unless the workers upgrade their skills, thereby improving their value to the employers. This paper also corroborates the authors’ interview observations on platforms deviating on stated worker contracts by simulating the same in the model. This paper finds that when platforms deviate on their stated incentive schemes, the unemployment rate tends to increase. This paper also finds that the emergence of online platforms in an erstwhile off-line market decreases the average unemployment rate with a moderate increase in the offered wage and leisure.

Research limitations/implications

In this work, the focus has been to determine the worker-platform dyadic relationship. However, this is affected by consumer-related attributes such as ratings and associated reputation systems to promote trust between different stakeholders. Examining such a triadic relationship between consumers, platform and workers is required to comprehensively address the challenges of online gig economy.

Social implications

Skilling and training are critical for worker mobility across tasks and jobs, especially in the gig economy. Gig workers, in general, seek to improve their skill level through self- or platform-enabled training programmes. The workers are able to generate more revenue through the new skills and hence can improve their reservation wage as well. This in turn increases average offered wages and reduces the overall unemployment in the sector. Despite attempts to classify gig workers as formal workers by labour laws across countries, there is resistance from online platforms. This is due to increased liability and responsibility that the platforms have to incur that possible increase their costs and expenses. This study shows that regulations, such as minimum leisure or minimum wage, increase the average wage or leisure in the market and increase unemployment. However, this might be a short-term phenomenon. In the long term, the gig workers benefit by enhancing their skills to not only stay employed but also bargain for better wages and leisure. The governments can play a larger role by facilitating upskilling programmes for the gig workers.

Originality/value

An extensive literature survey indicates that while most of the work on gig economy regulation emphasises the social and legal aspects, this work is unique in modeling the techno-economics of gig work. Further, while most of the economic research on gig work, focuses on consumers, this work focuses on the under-researched area of worker welfare. This paper also validates the model results with findings from the interviews with gig workers.

Details

Digital Policy, Regulation and Governance, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2398-5038

Keywords

Article
Publication date: 20 May 2024

David Syam Budi Bakroh and Heikki Hiilamo

The purpose of the study is to emphasise the urgent need for pension policy reform within Indonesia’s social security system.

Abstract

Purpose

The purpose of the study is to emphasise the urgent need for pension policy reform within Indonesia’s social security system.

Design/methodology/approach

The methodology employed in this research includes qualitative techniques such as in-depth interviews and thematic content analysis.

Findings

The findings suggest various measures for pension reform, including revising eligibility criteria, adjusting benefit designs to cover housing and transportation costs, promoting Defined Benefit Plans, enforcing compliance, addressing insufficient contributions, advocating for transparency, and aligning social assistance programs with pension system enhancements. However, there is a trade-off between the adequacy of pension benefits and the amount of resources required.

Research limitations/implications

This study is limited by the need for more individuals knowledgeable about pension issues in Indonesia, primarily due to their high-ranking positions, making access challenging and potentially compromising the small sample size in research.

Practical implications

The research underscores the importance of maintaining policy consistency. It proposes a gradual increase in pension contributions as a pivotal strategy to ensure sustained financial security for retirees, particularly in the face of fiscal constraints. Also, the government should undertake comprehensive reforms, encompassing the revision of eligibility criteria, adjustment of minimum benefit designs, encouragement of employer contributions and effective management of compliance issues.

Social implications

Social implications emphasise the importance of enhancing the financial security of retirees within Indonesia’s ageing population.

Originality/value

The originality and value of the research lie in guiding pension reform from the viewpoint of key policymakers involved in Indonesia’s pension system.

Details

International Journal of Sociology and Social Policy, vol. 44 no. 9/10
Type: Research Article
ISSN: 0144-333X

Keywords

Article
Publication date: 15 January 2024

Edmond Berisha, Rangan Gupta and Orkideh Gharehgozli

The primary focus of this study is to examine the distributional consequences of the widespread increase in prices. The fundamental question the study aims to address is whether…

Abstract

Purpose

The primary focus of this study is to examine the distributional consequences of the widespread increase in prices. The fundamental question the study aims to address is whether the dynamics of income distribution due to higher inflation differ in the short term compared to the long run.

Design/methodology/approach

The authors estimated a panel-data model (fixed effects) using inequality and inflation data available at a high frequency, i.e. on a quarterly basis for over 30 years, and found evidence that inflation causes rapid swings in income distribution.

Findings

The authors’ contribution to the literature lies in providing evidence that inflation rapidly causes swings in income distribution, even after controlling for the state of the economy. The authors also demonstrate that the magnitude and direction of the effect of inflation on income inequality depend on whether the initial inflation rate is below or above the Federal Reserve’s target of 2%.

Originality/value

To the best of the authors’ knowledge, the authors are the first to emphasize that the targets set by central banks can drive the strength and direction of the relationship between inflation and income inequality.

Details

Journal of Economic Studies, vol. 51 no. 7
Type: Research Article
ISSN: 0144-3585

Keywords

Article
Publication date: 20 March 2024

Vladimir Hlasny, Reham Rizk and Nada Rostom

COVID-19 has had various effects on women’s labour supply worldwide. This study investigates how women’s labour market outcomes in the MENA region have been affected by the…

Abstract

Purpose

COVID-19 has had various effects on women’s labour supply worldwide. This study investigates how women’s labour market outcomes in the MENA region have been affected by the stringency of governments’ COVID-19 responses and school closures. We examine whether women, particularly those with children at young age, reduced their labour supply to take care of their families during the pandemic.

Design/methodology/approach

To investigate whether having a family results in an extra penalty to women’s labour market outcomes, we compare single women to married women and mothers. Using the ERF COVID-19 MENA Monitor Household Surveys, we analyse the key conditions underlying women’s labour market outcomes: (1) wage earnings and labour market status including remaining formally employed, informally, unpaid or self-employed, unemployed or out of the labour force and (2) becoming permanently terminated, being suspended, seeing a reduction in the hours worked or wages, or seeing a delay in one’s wage payments because of COVID-19. Ordered probit and multinomial logit are employed in the case of categorical outcomes, and linear models for wage earnings.

Findings

Women, regardless of whether they have children or not, appear to join the labour market out of necessity to help their families in the times of crisis. Child-caring women who are economically inactive are also more likely to enter the labour market. There is little difference between the negative experiences of women with children and child-free women in regard to their monthly pay reduction or delay, or contract termination, but women with children were more likely to experience reduction in hours worked throughout the pandemic.

Research limitations/implications

These findings may not have causal interpretation facilitating accurate inference. This is because of potential omitted variables such as endogenous motivation of women in different circumstances, latent changes in the division of domestic work between care-giving and other household members, or selective sample attrition.

Originality/value

Our analysis explores the multiple channels in which the pandemic has affected the labour outcomes of MENA-region women. Our findings highlight the challenges that hamper the labour market participation of women, and suggest that public policy should strive to balance the share of unpaid care work between men and women and increase men’s involvement, through measures that support child-bearing age women’s engagement in the private sector during crises, invest in childcare services and support decent job creation for all.

Details

International Journal of Manpower, vol. 45 no. 6
Type: Research Article
ISSN: 0143-7720

Keywords

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